Getting Millennials To Buy CPGs: Bring On The BOGOs

Millennials are projected to spend $65 billion on consumer packaged goods (CPG) over the next decade, yet there are many misconceptions and challenges in reaching these shoppers, according to a white paper by WPP's Geometry Global.

There are “many traps CPG marketers can unknowingly fall into if they make decisions by only referencing generalized information or trends about Millennials," says Eric Pakurar, Chief Strategy Officer, Geometry Global North America. "When we took a close look at Millennials’ shopping behavior in CPG categories, we found that very few widely-believed assumptions about Millennials held up. For instance, when they’re going out to buy paper towels, shampoo or make-up, they don’t travel in packs, they don’t research products online and they’re not using their mobile phone as an in-store or list-making tool. This research showed us how critical it is to examine the life stage and shopping goal— such as the categories they’re shopping for— to understand or predict their shopping behavior."

One important insight uncovered by the research is that digital and mobile play a very limited role — if any — with Millennial CPG shoppers. Retailer apps are competing with every other app on a Millennial’s phone, which means that no marketer should assume that just because Millennials are "mobile," they will seek out a retailer or a brand app. Most Millennials actually weren’t aware of these apps at all. 

Millennial-age shoppers rarely look online before shopping  and even then, the main resource they seek is customer reviews. They avoid manufacturer Web sites, viewing them as biased.

Instead, once in stores, Millennials are task-oriented shoppers. They like to get in and out of stores quickly and they are on the lookout for shortcuts and cues to help guide shopping or alert them to special offers. The like to use aisle endcaps, for example, as navigational tools and are more likely to go down the aisle to “get the best deal.” They want to make the comparison at shelf based on all of the choices they have.

And a recurring theme is that most Millennials tend to purchase products only when they run out. Indeed, these young shoppers do not typically plan their shopping trips or make shopping lists. Only one in five shoppers will set a budget for their trip, and the majority have only a semi-defined, total-trip estimate that they didn’t plan to stick to “strictly.”

In addition to their procrastination, Millennials are loners. Many of these shoppers prefer to shop alone while grocery shopping, a sharp contrast to apparel shopping. And, with a few exceptions, they don’t ask for input from their (Facebook) friends. 

Meanwhile, Millennials are typically less driven by defined possessions, and that extends to communal ownership of many household products — although there are still some personal items that are off-limits. Those with roommates were not likely to have set schedules or rules about how purchases for the home were split or consumed. Often, when something runs out, the next roommate to visit the store makes the purchase.

The research also found that although Millennials are very aware of climate change and opt for environmentally friendly products in most categories, few “green” products actually make it into their carts due to confusion about the actual benefit and the fact that most of their purchasing decisions are dictated by price.

"While they didn’t always buy cause products, many were very aware of bringing in their own bags to shop," says Pakurar. "Bringing your own bag is a more visible sign of being socially-conscious — rather than buying environmentally-friendly toilet paper — and it’s easy to connect using your own bag to a direct environmental impact. They reality is Millennials do tend to rally around causes, but brands need to do a better job of communicating the impact and give Millennials a reason to care."

Ultimately, brand loyalty among Millennials may seem like an oxymoron, yet Geometry Global's research shows that these young consumers do respond to promotions and retailer loyalty programs that offer the specific kinds of rewards they seek — namely, something tangible (besides points), such as gas benefits, free products, or a percentage discount off a purchase. "Coupons, discounts and loyalty programs are often viewed as being for an older crowd, but Millennials love them too," says Pakurar. "What they don’t love, however, is the old-fashioned execution of deals. Many don’t have printers—so forget about digital coupons, they don’t like clipping and the key-chain loyalty cards are outdated. They love [buy-one, get one] BOGOs. They love getting 15% more product. Those are tangible things and you can point to what you're getting. There is a big opportunity to rethink how we use coupons and promotions to get Millennials to try something new."

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